Crypto Market Plunges Today: The Real Reasons Behind the Crash Finally Revealed
Crypto Market Meltdown: The Real Reasons Bitcoin Crashed Below $90,000
The global cryptocurrency market is facing one of its sharpest pullbacks in recent months as Bitcoin’s price slipped below the crucial $90,000 mark for the first time in seven months. The sudden drop triggered widespread concern across the digital asset industry, driving down investor confidence and intensifying volatility.
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| Source: Xpost |
According to aggregated market data reviewed by hokanews, the total crypto market capitalization has fallen 4.92% in the past 24 hours, landing near $3.08 trillion. Bitcoin has declined by more than 6%, Ethereum has retreated by almost 7%, and altcoins across the board have posted losses between 5% and 20%. The sell-off reflects a shift toward caution, especially as delayed U.S. economic data looms following the recent government shutdown.
While most major assets have turned red, a few exceptions—such as Zcash, Monero, and Astar—have managed to register gains. However, these isolated surges have done little to offset the broader downtrend gripping the market.
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| Source: Xpost |
ETF Outflows Accelerate the Downturn
One of the clearest indications of mounting pressure comes from the U.S. spot ETF market. Data compiled by SOSO Value reveals that Bitcoin ETFs have recorded more than $1.89 billion in outflows over just four days. The latest single-day outflow was a substantial $254 million, highlighting the extent of investor anxiety.
Ethereum ETFs are under similar strain. In the past week alone, over $911 million has exited ETH ETF products, including a $182.8 million outflow on November 17. With Ethereum’s price hovering around the $3,000 level, ETF assets have dropped toward $18.7 billion.
The massive withdrawals signal that institutional investors—once seen as stabilizing forces—are now adding to the selling pressure as they reassess exposure to risk-based assets.
Fear & Greed Index Falls Into Extreme Fear Territory
The downturn is further reflected in the latest readings from the widely followed Fear & Greed Index. The indicator slid to 11, its lowest point in weeks, firmly positioning the market in the Extreme Fear category.
Just a day earlier, the index stood at 14. A week ago, it was 26. Last month, it was 29. The downward spiral highlights worsening investor sentiment and growing uncertainty as market conditions soften. Historically, such extreme levels are associated with heightened volatility and the potential for further price swings.
The steep collapse in sentiment signals a stark shift in market psychology, with various factors playing a role in reinforcing bearish momentum.
Over $1 Billion Liquidated in 24 Hours
Data from CoinGlass shows the magnitude of the turmoil. In the past 24 hours alone, more than $1.01 billion in positions have been liquidated across the market.
Bitcoin suffered the heaviest blow with $561.67 million in forced liquidations, while Ethereum recorded $173.50 million. Altcoins like XRP and ZEC posted steep liquidations as well, reflecting the breadth of the sell-off.
A total of 180,975 traders were liquidated, with long positions accounting for more than $718 million. The largest single liquidation event was a $96.51 million BTC-USD position on Hyperliquid, underscoring the scale of leveraged risk in the market.
The liquidation wave intensified the downturn by creating additional downward pressure, as leveraged positions exited the market in rapid succession.
Macroeconomic Uncertainty and the Fed’s Cautious Tone
Macroeconomic conditions remain a central factor behind the sudden weakening of the crypto market. With key U.S. economic data delayed due to the government shutdown, traders are operating in a climate of uncertainty. This has amplified the impact of recent statements from Federal Reserve officials.
Fed Chair Jerome Powell noted that further rate cuts are “not a foregone conclusion," suggesting a more cautious stance. Boston Fed President Susan Collins added that interest rates might need to remain higher for longer. This revised outlook has rattled risk-on markets including cryptocurrencies.
Analysts, including Deutsche Bank’s Henry Allen, have emphasized that investors often underestimate how strongly crypto assets respond to shifts in Fed policy and liquidity expectations. The combination of delayed data and guarded Fed commentary has contributed to tightening financial conditions, prompting traders to reassess their portfolios.
Halving Cycle Anxiety Returns
Bitcoin’s April 2024 halving and the peak that followed six months later have reignited discussions about historical price patterns. While past cycles have included significant drawdowns following major post-halving rallies, the growing involvement of institutional investors has altered the structure of market behavior.
Still, fear has resurfaced. Traders wary of a potential repeat of previous cycles are exiting their positions earlier than expected. This time, the fear is amplified by other contributing factors: miner selling, leveraged position liquidations, and weakening retail confidence.
Bitwise CIO Matthew Hougan commented that retail sentiment is “so bad” that further downside remains possible. The combination of systemic fragility and halving cycle concerns has heightened sensitivity to macroeconomic shifts.
Crypto Market Still Driven by Emotion, Despite Institutional Growth
Despite increasing institutional participation, Bitcoin and other digital assets continue to show strong correlations with traditional macroeconomic variables. Analysts like Nansen’s Jake Kennis note that Bitcoin now responds more directly to institutional flows, dollar strength, and liquidity cycles than to cyclical crypto-native events.
The market’s emotional volatility remains apparent. Altcoins have absorbed significant damage, initial optimism tied to pro-crypto political discussions has faded, and speculative capital is shifting toward emerging sectors like AI tokens, advanced stablecoin protocols, and prediction-market platforms.
This combination of psychological and macroeconomic pressures has contributed to a fragmented market landscape, where certain niches continue to grow even as broader sentiment deteriorates.
Key Support Levels: What Traders Are Watching Next
Bitcoin (BTC)
Analysts are focusing closely on the $88,000 to $90,000 support zone. A strong bounce from this range could send Bitcoin back toward $94,000 or even $97,000. However, a decisive breakdown would expose deeper support levels in the mid-$80,000 range—or potentially the $75,000 region.
If Bitcoin falls further, the market may see another wave of liquidations that could intensify the downturn.
Ethereum (ETH)
Ethereum faces its own set of challenges. The key level remains $3,000. If ETH can reclaim and hold this level with strong buying volume, confidence may return. If not, analysts warn that ETH could retreat toward $2,750 or even $2,600 if selling persists.
Overall, the market is facing a crucial test. Whether the correction stabilizes or deepens will depend on ETF flows, macroeconomic clarity, and investor sentiment in the coming days.
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